WO/GA/46/11

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WO/GA/46/11
ORIGINAL: ENGLISH
DATE: JULY 22, 2014

WIPO General Assembly

Forty-Sixth (25thExtraordinary) Session

Geneva, September 22 to 30, 2014

PROPOSED AMENDMENTS TO THE FINANCIAL REGULATIONS AND RULES (FRR)

presented by the Director General

  1. The present document contains Proposed Amendments to the Financial Regulations and Rules (FRR) (document WO/PBC/22/10), which is being submitted to the WIPO Program and Budget Committee (PBC) at its twenty-second session (September 1 to 5, 2014).
  2. Any decisions of the PBC in respect of that document will appear in the List of Decisions Taken by the Program and Budget Committee at its TwentySecond Session (September1to5,2014) (document A/54/5).

[Document WO/PBC/22/10 follows]

WO/PBC/22/10

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WO/PBC/22/10
ORIGINAL: ENGLISH
DATE: JULY, 11, 2014

Program and Budget Committee

Twenty-Second Session

Geneva, September 1 to 5, 2014

PROPOSED AMENDMENTS TO THE FINANCIAL REGULATIONS AND RULES (FRR)

presented by the Director General

INTRODUCTION

  1. The present document contains proposals for amendments to WIPO’s Financial Regulations and Rules (FRR). The changes primarily address the need to update the FRR in order to align it with the evolution of other elements of WIPO’s regulatory framework; to recognize the evolution of current practices and business requirements of the Organization or provide clarification required in day-to-day operations on specific issues;and to address inconsistencies or inaccuracies in the FRR where needed.

PROPOSED AMENDMENTS TO FINANCIAL REGULATIONS

  1. In accordance with the provisions of Regulation 10.1 “The Director General may propose amendments to these Regulations. Any such amendment to these Regulations must be approved by the General Assembly”. Amendments are proposed to Regulations 2.8, 5.10, 5.11, 8.1 and 8.9.

(i)Regulation 2.8: the appropriate text has been added, in accordance with the recommendation of the IAOC, and in line with the treaties administered by the Organization, to reflect the scenario where the Program and Budget of the Organization may not be adopted in time for the start of a new biennium;

(ii)Regulation 5.10: it is proposed to align the regulation with the United Nations (UN) System practice and remove the limitation of 20 thousand Swiss francs per biennium on ex gratia payments; and

(iii)Regulation 5.11: it is proposed to more closely align the definition of procurement and its guiding principles with those of other UN Common System organizations.

(iv)Regulations 8.1 and 8.9: reference to the Auditor General is corrected from the currently used “officer”, to “official”.

  1. The following decision paragraph is proposed.
  1. The Program and Budget Committee recommendedto the WIPO General Assemblyto approve Regulations 2.8, 5.10, 5.11, 8.1 and 8.9 as amended in document WO/PBC/22/10.

AMENDMENTS TO FINANCIAL RULES

  1. In accordance with Financial Regulation 10.1, Rule 110.1, the “present Rules may be amended by the Director General in a manner consistent with the Financial Regulations”. Therefore, the amendments will be made by the Director General to the Financial Rules101.3(k), 104.1(b), 104.5, 104.6(a), 104.13, 105.13,105.16(b), 105.17, 105.18, 105.21, 105.22, 105.30, 106.4, and 106.12.

(i)Rule 101.3(k): the definition of “officer” is revised to align it with the current Staff Regulations and Rules;

(ii)Rule 104.1(b): thisrule clarifies and confirms the Organization’s practice of allocating spending authority for Funds in Trust only against cash received;

(iii)Rules 104.5 and 106.4: these changes serve to correctlyreflect the terminology used to describe WIPO’s external offices (replace the term “liaison offices” with “external offices”);

(iv)Rule 104.6(a): the reference to Cashier’s Fund advances is removed, as WIPO does not make these types of advances;

(v)Rule 104.13: the revision is needed to clarify that investments losses are reported on within three months of the end of each calendar year of the biennial financial period;

(vi)Rules 105.13, 105.16(b), 105.17, 105.18, 105.21, 105.22, 105.30(a) and (b): the changes to these rules are required to reflect current procurement practices and/or serve to help streamline the FRRs by removing detailed guidance which appears in Office Instructions.

(vii)Rules 105.17, 105.21 and 105.30 (a): the changes clarify that it is the Director General who, through the issuance of Office Instructions, sets out the thresholds for various forms of procurement procedures, the guidance for award of procurement contracts and establishes the Property Survey Board (not the High Level Official on Procurement);

(viii)Rule 105.30(a): the change reflects the fact that the Property Survey Board does not “establish degree of responsibility for loss or damage” to WIPO property. This is done following the appropriate procedures set out, either as part of an investigation or other relevant process.

(ix)Rule 106.12: the change is needed to correct a previously erroneous cross reference to the Regulation dealing with the financial management report; and

  1. The following decision paragraph is proposed.
  1. The Program and Budget Committee took note of the amendments to the Financial Rules listed in paragraph 5 of document WO/PBC/22/10.

[Proposed Amendments to the Financial Regulations and Rules follow]

WO/PBC/22/10

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PROPOSED AMENDMENTS TO THE FINANCIAL REGULATIONS AND RULES

Current Text / Proposed New Text / Comments (where applicable)
CHAPTER 1: GENERAL PROVISONS / CHAPTER 1: GENERAL PROVISIONS
Definitions
Rule 101.3
(k)“Officer” is a person employed by the Organization on a fixed-term, permanent, or temporary appointment and whose relationship with the Organization is governed by the Staff Regulations and Staff Rules; /
Definitions
Rule 101.3
(k)“Officer” is a personemployed bystaff member of the Organization, that is, an individual employed under on a fixed-term, continuing, permanent, or temporary appointment and whose relationship with the Organization is governed by the Staff Regulations and Staff Rules; / This proposed change is required to reflect the changes in the Staff Regulations and Rules (SRR).
CHAPTER 2: THE PROGRAM AND BUDGET / CHAPTER 2: THE PROGRAM AND BUDGET
Review and Approval
Regulation 2.8
The Assemblies of the Member States and of the Unions, each as far as it is concerned, shall adopt the program and budget for the following financial period after consideration of the proposed program and budget and the recommendations of the Program and Budget Committee thereon.
/
Review and Approval
Regulation 2.8
The Assemblies of the Member States and of the Unions, each as far as it is concerned, shall adopt the program and budget for the following financial period after consideration of the proposed program and budget and the recommendations of the Program and Budget Committee thereon. If the program and budget is not adopted before the beginning of the following financial period, the authorization to the Director General to incur obligations and make payments would remain at the level of appropriations of the previous financial period.
/ As recommended by the IAOC, this clause is proposed to be enhanced to address the possible scenario when the program and budget is not adopted before the beginning of the following financial period, in line with the requirements of the treaties administered by WIPO.
CHAPTER 4: CUSTODY OF FUNDS
/
CHAPTER 4: CUSTODY OF FUNDS
A.INTERNAL ACCOUNTS
/
A.INTERNAL ACCOUNTS
Trust funds and special accounts
Rule 104.1
The establishment, purpose and limits of trust funds and special accounts shall be approved on behalf of the Director General by the Controller. The Controller is authorized to levy a charge on trust funds and special accounts. This charge shall be used to reimburse all, or part of, the indirect costs incurred by the Organization in respect of the generation and administration of trust funds and special accounts. All direct costs of the implementation of programs that are financed by trust funds and special accounts shall be charged against the relevant trust fund and special account. / Trust funds and special accounts
Rule 104.1
(a)The establishment, purpose and limits of trust funds and special accounts shall be approved on behalf of the Director General by the Controller. The Controller is authorized to levy a charge on trust funds and special accounts. This charge shall be used to reimburse all, or part of, the indirect costs incurred by the Organization in respect of the generation and administration of trust funds and special accounts. All direct costs of the implementation of programs that are financed by trust funds and special accounts shall be charged against the relevant trust fund and special account.
(b)The Controller may provide authorization for the utilization of voluntary contributions up to the amounts received in cash. / Change is proposed in order to reflect WIPO’s prudent financial practice of allocating spending authority only against cash received for Funds in Trust.
B.BANKING
/
B.BANKING
Remittances to liaison offices
Rule 104.5
The liaison offices of the Organization shall obtain their funds through remittances from Headquarters. In the absence of a special authorization from the Controller, those remittances shall not exceed the amount required to bring cash balances up to the levels necessary to meet the recipient liaison office’s estimated cash requirements for the next two and a half months. / Remittances to liaison offices External Offices
Rule 104.5
The liaison offices External Offices of the Organization shall obtain their funds through remittances from Headquarters. In the absence of a special authorization from the Controller, those remittances shall not exceed the amount required to bring cash balances up to the levels necessary to meet the recipient liaison office’s estimated cash requirements for the next two and a half months. / WIPO has External Offices.
Cash advances
Rule 104.6
(a)Petty cash advances and Cashier’s Fund advances may be made only by and to officers designated for this purpose by the Controller.
(b)The relevant accounts shall be maintained on an imprest system and the amount and purpose of each advance shall be defined by the Controller.
(c)The Controllermay approve other cash advances, as may be permitted by the Financial Regulations and Rules and Financial Instructions issued by the Controller,and as may otherwise be authorized in writing by him or her. / Cash advances
Rule 104.6
(a)Petty cash advances and Cashier’s Fund advances may be made only by and to officers designated for this purpose by the Controller.
(b)The relevant accounts shall be maintained on an imprest system and the amount and purpose of each advance shall be defined by the Controller.
(c)The Controllermay approve other cash advances, as may be permitted by the Financial Regulations and Rules and Financial Instructions issued by the Controller,and as may otherwise be authorized in writing by him or her.
/ To reflect current practice i.e., “Cashier’s Fund advances” are not made.
C.INVESTMENTS / C.INVESTMENTS
Losses
Rule 104.13
Any investment losses must be reported at once to the Controller. The Controller may authorize the writing-off of investment losses. A summary statement of investment losses, if any, shall be provided to the External Auditor within three months following the end of the financial period. / Losses
Rule 104.13
Any investment losses must be reported at once to the Controller. The Controller may authorize the writing-off of investment losses. A summary statement of investment losses, if any, shall be provided to the External Auditor within three months following the end of each calendar year of the financial period. / Rule amended to clarify that the statement of losses will need to be prepared for each calendar year of the financial period for inclusion in the annual financial statements.
CHAPTER 5: UTILIZATION OF FUNDS /
CHAPTER 5: UNTILIZATION OF FUNDS
B.COMMITMENTS, OBLIGATIONS AND EXPENDITURES /
B.COMMITMENTS, OBLIGATIONS AND EXPENDITURES
Ex gratia payments
Regulation 5.10
The Director General may make such ex gratia payments as are deemed to be necessary in the interest of the Organization, provided that a summary statement of such payments for the calendar year shall be included in the annual financial statements of the Organization. The total amount of such payments shall not exceed 20,000 Swiss francs in any given financial period. / Ex gratia payments
Regulation 5.10
The Director General may make such ex gratia payments as are deemed to be necessary in the interest of the Organization, provided that a summary statement of such payments for the calendar year shall be included in the annual financial statements of the Organization. Ex gratia payment is a payment made where there is no legal liability to pay, but where the moral obligation is such as to make payment desirable. The total amount of such payments shall not exceed 20,000 Swiss francs in any given financial period. / To align with the UN Common System (UN no limit; IAEA no limit in regulations (may be set by the Board); ILO no limit; IMO no limit; ITU no limit; PAHO no limit; UNESCO no limit; UNHCR no limit; WFP no limit; WHO no limit; WMO no limit. Organizations which have limits include UNFPA and UN Women at 75 thousand USD per year, but no limit if made for humanitarian reasons; and UNOPS, limited at 1% of their management budget).
C.PROCUREMENT / C.PROCUREMENT
General principles
Regulation 5.11
Procurement functions include all actions necessary for the acquisition, by purchase, lease, or any other appropriate means, of property, including products and real property, and for the acquisition of services, including building works. For the purposes of the present Regulations, procurement shall not be deemed to refer to the acquisition of services provided under employment contracts and to services provided under external non-commercial consultancy contracts. The following general principles shall be given due consideration:
(a)Best value for money.
(b)Effective and broad competition for the award of contracts.
(c)Fairness, integrity and transparency of the procurement process.
(d)The best interests of the Organization.
(e)Prudent commercial practices.
(f)Acquisitions of goods and/or services shall be made on the basis of a formal contract award procedure. Methods of solicitation may be formal and/or informal.
(g)Solicitations shall be invited by advertisement unless otherwise prescribed. / General principles
Regulation 5.11
(a)Procurement functions include all actions necessary for the acquisition, by purchase, lease, or any other appropriate means, of property, including products and real property, and for the acquisition of services, including building works. For the purposes of the present Regulations, procurement shall not be deemed to refer to the acquisition of services provided under employment contracts and to services provided under external non-commercial consultancy contracts. The following general principles shall be given due consideration:
(i)(a) Best value for money.
(ii)(b) Effective and broad competition for the award of contracts.
(iii)(c) Fairness, integrity and transparency of the procurement process.
(iv)(d) The best interests of the Organization.
(v)(e) Prudent commercial procurement practices.
(f) Acquisitions of goods and/or services shall be made on the basis of a formal contract award procedure. Methods of solicitation may be formal and/or informal.
(g) Solicitations shall be invited by advertisement unless otherwise prescribed.
(b)The acquisition of goods and/or services shall be made on the basis of contract award procedures. Methods of solicitation may be formal and/or informal. Solicitations shall be invited by advertisement unless otherwise prescribed. Contract award procedures and methods of solicitation shall be defined in an Office Instruction issued by the Director General. / To align with UN System organizations and ensure that all procurement activity is covered by this regulation, and that the general principles elaborated here are given due consideration in all procurement activities.
Text is moved to reflect different nature of the substance (requirement for contract award procedures and solicitation are not part of the general principles which should be considered). The procurement procedures are promulgated through Office Instructions issued by the Director General.
Cooperation
Rule 105.13
The Organization may cooperate with other organizations of the United Nations system to meet its procurement requirements by entering into agreements for such purposes as appropriate. Such cooperation may include the carrying out of common procurement actions, or the Organization entering into a contract relying on a procurement decision of another specialized agency of the United Nations, or the Organization requesting another specialized agency of the United Nations to carry out procurement activities on its behalf. / Cooperation
Rule 105.13
The Organization may cooperate with inter-governmental other organizations of the United Nations system to meet its with similar procurement procedures to meet its procurement requirements by entering into agreements for such purposes as appropriate. Such cooperation may include the carrying out of common procurement actions, or the Organization entering into a contract relying on a procurement decision of another inter-governmental specialized agency of the United Nations, or the Oorganization, or WIPO requesting another inter-governmental organizationspecialized agency of the United Nations to carry out procurement activities on its behalf.
/ Amendments are targeted at further clarifying conditions for cooperation, and extending the scope of cooperation to other inter-governmental organizations which may not be part of the UN System, but which have similar procurement procedures to WIPO’s.
Procurement Process
Rule 105.16
(a)An obligation can result from a single requisition, or a series of related requisitions received and processed during the contract term or the calendar year, and includes all contracts and/or purchase orders for the acquisition of goods or services. The HLOP, or the officers to whom he or she will delegate the related authority, shall identify whether requisitions are related and shall take the appropriate procurement action.
(b)For contracts without a fixed term or subject to renewal, the value of the obligation shall be determined on the basis of a deemed contract duration of three years. / Procurement Process
Rule 105.16
(a)An obligation can result from a single requisition, or a series of related requisitions received and processed during the contract term or the calendar year, and includes all contracts and/or purchase orders for the acquisition of goods or services. The HLOP, or the officers to whom he or she will delegate the related authority, shall identify whether requisitions are related and shall take the appropriate procurement action.
(b)For contracts without a fixed term or subject to renewal, the value of the obligation shall be determined on the basis of a deemed contract duration of three years.an assumed contract duration of one year, measured from the date performance is to begin. / The revision establishes a more appropriate base for determining the value of the obligation.